Farmland owners, do you recognize this image below? It’s a yield map, and it’s one of the most important communication tools your farmer can provide to help you understand your farm’s performance. If you aren’t receiving yield maps from your farmer today, you should start asking for them. Here are 4 big reasons why:
1. Use yield data to determine gross revenue
When you have yield data, it is a simple calculation to determine the gross revenue generated by your farm (yield*price of crop/bu = gross revenue). This number is important in helping determine a fair market If you need more information about the different approaches used to calculate this critically important number, read our article, “Calculating Cash Rent.”
2. Understand the nutrition management of your farm
3. Just how good is your farmer?
Having an accurate farm yield history can help you determine whether you have an average farmer, a good farmer, or a great farmer. Historic average yields for every county are available through the USDA (see the sample below from DeKalb County, IL), and although yield will depend on the quality of your farm, you can compare the trendlines—a good farmer’s productivity and trendline should be better than average. As an aside, many landowners don’t realize that even if grain prices are stable, farm yields are going up over time (yields have increased 170% since 1950), meaning that the revenue generated by your farm is also going up.
4. Increase the value of your farm
If you ever choose to sell your farm, having yield or production records will likely increase the value of the farm. As is outlined in this Iowa state article about financing the purchase of a farm, potential yields influence both what a farmer and an investor are willing to pay for a farm. Your farm is an investment, and since farm yield directly impacts revenue, having strong yield data helps substantiate a higher price for a farm whether the potential buyer is a farmer or a landowner.
Collecting yield data and making these comparisons is just one thing that Tillable helps do for landowners to help ensure that your asset is being taken care of and performing to its potential. We can help you get started with a Free Farmland Checkup.
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